The Directors have pleasure in presenting the Twenty First Annual
Report of your Company with Audited Accounts for the year ended 31
March, 2014.

PERFORMANCE:

The Performance of the Company for the year ended 31 March, 2014 is
briefly set out below:

(Rs.) in Lakhs

INCOME FOR THE YEAR 124.31

LESS: EXPENDITURE FOR THE YEAR 70.80

PROFIT BEFORE DEPRECIATION & TAX 53.51

LESS: DEPRECIATION 20.14

LESS: PROVISION FOR TAX & STANDARD ASSETS 10.86

PROFIT AVAILABLE FOR APPROPRIATION 22.51

ADD: OPENING BALANCE IN P&L ACCOUNT 112.82

LESS: SHORT PROVISION FOR TAX F.Y.2012-2013 7.25

ADD: EXCESS PROVISION MADE F.Y.2008-2009 & 2010-2011 13.64

LESS: TRANSFER TO STATUTORY RESERVES 4.50

BALANCE C/F TO P&L ACCOUNT 137.22

DIVIDEND:

Your Company has not recommended any Dividend due to insufficient
profits. This may also strengthen the reserves.

MANAGEMENT DISCUSSION & ANALYSIS:

REVIEWOFOPERATIONS:

During the year your company''s loans totalling Rs. 1066.00 lakhs were
disbursed as against Rs. 447.80 lakhs in the previous year. None of the
borrowal accounts have fallen NPA. Many of the disbursements are
mainly or collaterally secured by valued assets. The working capital
finance alone amounted Rs. 1005.00 lakhs against receivables during the
period under review. The total interest income of Rs.41.63 lakhs which
is due to working capital finance alone. The other income for the year
stood at Rs.82.67 lakhs such as Rs. 12.55 lakhs collected as Other
Commission & service charges & Rs. 19.38 lakhs as Dividend from Equity
shares, Mutual Funds & Rs. 15.66 lakhs from Profit on share trading.
While comparing previous years income, there is marginal increase in
many heads.

With a view to reduce its financial portfolio, your company decreased
the .investment area by Rs. l 87.24 lakhs & increase its other types
such as Bills / loan portfolio to Rs. 1005.00 lakhs. The resultant
position will enable the company to commensurate with its resources in
relation to employment of funds.

Your Company is happy to inform you that due to constant review, follow
up, the company has been complying with Asset / Income pattern norms
fixed by RBI for NBFC companies in the current year under review.

WEBSITE:

Performance particulars of the Company can be ascertained by the share
holders / public from website, www.afslindia.com

FUTURE PROSPECTS:

While your Directors have carefully considered the financial market
conditions, it thought that we are unable to find out any viable
opportunity to do its NBFC business & there is not enough scope for non
banking financial activities now & hence the company has surrendered
NBFC licence to RBI. It intends to diversify its main activities from
NBFC with available resources & present infrastructure into a feasible
activities in order to protect the shareholders interests.

ECONOMY MEASURES:

The Company has put into effect economy measures consistent with the
need to continue the operations on a moderate scale with efficiency and
promptness.

RISKS AND CONCERNS:

Your Company is exposed to normal industry risk factor such as Interest
rate volatility, economic cycle and credit risk. Your Company manages
these risks by adopting prudent business and risk management policies.

ADEQUACY OF INTERNAL CONTROL:

Your Company has got adequate system of internal controls and the
management ensures adherence to all internal control practices and
procedures. The Audit Committee critically reviews periodically the
adequacy of internal controls and suggests control measures for further
improvement / transparency.

FIXED DEPOSITS:

The Company does not hold any deposits from the public or others as at
31 March, 2014 and hence, the company does not have any unpaid deposit
or interest.

DIRECTORS:

Mr.Teckchand Vaswani and Mr.P. Sankaran Directors retiring by rotation,
being eligible have offered themselves for re-appointment.

At the Board Meeting held on 28/05/2014, Mr.P. Sankaran, Executive
Director has been re-appointed for a period of one year with effect
from 19/06/2014 on the terms and conditions as detailed in the Special
resolution placed for shareholder''s approval.

CORPORATE GOVERNANCE REPORT:

A Certificate from the auditors of the Company regarding compliance of
conditions of Corporate Governance as stipulated under Clause 49 of the
Listing Agreement is attached to this Report.

RESPONSIBILITY STATEMENT OF THE BOARD OF DIRECTORS:

In terms of provisions of Section 217(2AA) of the Companies Act, 2013,
your Directors confirm that:

1. In the preparation of the Annual Accounts, the applicable
accounting standards had been followed along with proper explanation
relating to material departures.

2. Directors had selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of
the company at the end of the financial year and of the profit of the
company for that period.

3. Directors had taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the provisions of
this Act for safeguarding the assets of the company and for preventing
and detecting fraud and other irregularities.

4. Directors had prepared the annual accounts on a going concern
basis.

STATUTORY DISCLOSURES:

(I) Since none of the employees are in receipt of such remuneration for
being included in the statement under Section 217(2 A) of the Companies
Act, 2013 read with Companies (Particulars of Employees) Rules, 1975,
the information in this regard is Nil.

(ii) The provisions of Companies (Disclosure of Particulars in the
Report of Board of Directors) Rules, 1988 requiring disclosure of
particulars regarding Conservation of Energy in Form A and Technology
Absorption in Form B prescribed by the Rules do not apply to your
Company, as it does not carry on manufacturing activities.

(iii) The Company had no foreign exchange inflow and outflow.

AUDITORS:

R.Bhaskar & Co, Chartered Accountants, Chennai are recommended for
re-appointment as Statutory Auditors of the company to hold office from
the conclusion of this Annual General meeting till the conclusion of
the next Annual General Meeting.

ACKNOWLEDGEMENTS:

Your Directors wish to place on record their gratitude to you as
shareholders for your continued support. They are thankful to your
Company''s Clients, Bankers, Reserve Bank of India, FIHPA, SIHPA, SEBI,
MSE, BSE and other Government Agencies for their valuable assistance.

They also wish to convey their appreciation to the employees whose
dedicated service has enabled your Company to function satisfactorily
in a continued unpredictable business climate.

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